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NetComm to Boost Revenue and Market Presence with Acquisition of Dynalink New Zealand

01 December, 2005 14:36

<p>Leading broadband hardware vendor NetComm Ltd (ASX: NTC), today announced it has signed an exclusive Heads of Agreement to acquire 100 per cent of the shares of New Zealand-based Dynalink Modems and its interest in its subsidiary Askey Australia.</p><p>Dynalink has been established in New Zealand for 15 years, and has been market leader for over a decade. Its range of products includes broadband ADSL, ADSL2 and ADSL2+ modems and routers, analogue modems, wireless LAN, networking solutions, USB/TV peripherals and VoIP products. These products are also distributed in Australia through its subsidiary company Askey Australia.</p><p>Askey Australia is jointly owned by Dynalink (81 percent) and Askey Taiwan (19 percent) – the largest ADSL modem manufacturer in the world.</p><p>“The agreement reached between the parties to the acquisition, is subject to final due diligence and completion of a share sale and acquisition agreement” said David Stewart, Managing Director of NetComm Limited.</p><p>“This acquisition will allow us to capitalise on synergies between the two operations and drive significant revenue and margin growth.</p><p>“NetComm has been investigating expansion into the New Zealand market for the last few months and the purchase of Dynalink opens the door for us. It is a well established company with a strong reputation for service, value and innovation. It has current relationships with major retailers and established sales channels with major distributors in New Zealand,” said David Stewart.</p><p>“The deal is a great way for NetComm to enter the New Zealand market and hit the ground running.”</p><p>The acquisition is expected to result in immediate business gains for NetComm by increasing market share through Dynalink’s established presence among major ISPs in the Australian market.</p><p>Deal Highlights</p><p>Dynalink Overview:Revenues to 31 March 2005 - &gt;AU$8 millionExpected post completion 12 month Revenues - &gt;AU$10 million</p><p>Terms:Purchase Price: NTA plus an earn out profit shareConsideration: New shares issued in NetComm Limited based on the average share price over the 5 days prior to closing.Conditions: Complete Due DiligenceFinalise Share Sale and Acquisition Agreement.</p><p>Dynalink staff will remain following the acquisition, and both the company name and product brand will be retained. Dynalink will also begin selling, distributing and supporting NetComm branded products via its existing infrastructure.</p><p>Mr Stewart believes that the acquisition will provide a lot greater choice in New Zealand.</p><p>“The growth of broadband adoption in New Zealand is similar in nature to Australia and with the combination of NetComm and Dynalink products together, New Zealand consumers will be the big winners with access to much greater choice.”</p><p>- ends -</p><p>About NetComm</p><p>NetComm is Australia's leading provider of broadband hardware solutions. It holds a commanding position in the key markets of Digital Subscriber Line (DSL), high-speed networking, wireless, hotspots and digital surveillance systems, and is developing a strong presence in the VoIP sector. NetComm products are researched, developed and engineered in Australia to meet local requirements and conditions. The company has a history of sustained growth and innovation, and is listed on the Australian Stock Exchange (ASX: NTC). For more information visit www.netcomm.com.au</p><p>About Dynalink</p><p>Dynalink is New Zealand’s leading provider of broadband, networking and VoIP products and solutions. It has been established in New Zealand for 15 years, and has been market leader for over a decade. Its range of products includes broadband ADSL, ADSL2 and ADSL2+ modems and routers and networking solutions. The quality of Dynalink’s products and service has attracted repeated Readers Choice awards from the technology media. The company’s products are distributed in Australia through subsidiary company Askey Australia. For more information visit www.dynalink.co.nz</p><p>Media Contact:Belind CotterKinetics Pty Ltd02 9976 6611belinda@kinetics.com.au</p>

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